Income Tax Slab Rates for 2016-17 & 2017-18 in India – Updated

Budget 2017 Update: The rate of Income Tax has been reduced from 10% to 5% for Income from Rs. 2.5 Lakhs to 5 Lakhs. There is no other change in the Income Tax slab Rates. The Income Tax for Income from Rs. 5 Lakhs to Rs. 10 Lakhs is the same i.e. 20% and above Rs 10 Lakhs is also the same i.e. 30%. The rates of surcharge and its applicability has also been changed with effect from Financial Year 2017-18 onwards and the same has been explained below.

Income Tax Slab Rates for 2016-17 & 2017-18

The Income Tax Slab Rates are different for different categories of taxpayers.

The Income Tax Slab Rates can be divided in the following categories:-

A.INDIVIDUALS & HUF

For Male & Female Individuals below 60 Years of Age and HUF

For all Senior Citizen above 60 years of Age

For all Super Senior Citizen above 80 years of Age

Applicability of Surcharge

B. BUSINESSES

Co-operative Society

Firms, Local Authority & Domestic Company

C. Education Cess and SHEC

Income Tax Slab Rates

A. FOR INDIVIDUALS & HUF

The following Income Tax Slabs are applicable for the Financial Year 2016-17 i.e. Assessment Year 2017-18 and Financial Year 17-18 i.e. Assessment Year 18-19. Education Cess @ 2% and SHEC @ 1% shall be levied on the Tax computed using the Income Tax Rates given below while filing the Income Tax Return.

It is pertinent to note here that the Govt also provides Rebate under Section 87A for taxpayers having low Income. This rebate has been reduced from Rs. 5000 p.a. to Rs. 2,500 p.a. in the Budget 2017. Moreover, this Rebate is only available only to Resident Individuals whose Total Income does not exceed Rs. 3,50,000.

Where the Total Income exceeds Rs. 5,00,000 but does not exceed Rs. 10,00,000

20% of the Amount by which it exceeds Rs. 5,00,000

Where the Total Income exceeds Rs. 10,00,000

30% of the Amount by which it exceeds Rs. 10,00,000

Computation of Age

If an Individual attains the age of 60 years or 80 years during the financial year, his age shall be regarded as 60/80 (as the case may be), for that whole Financial Year.

Surcharge to be levied if Income more than Rs. 50 Lakhs

If the Income of the Individual/ HUF/ AOP/ BOI is more than 50 Lakhs, surcharge would also be applicable. Surcharge would be applicable as per the below mentioned slabs:-

Level of Income

Surcharge

Less than Rs. 50 Lakhs

NIL

More than Rs. 50 Lakhs but less than Rs. 1 Crores

10%

More than Rs. 1 Crores

15%

It is pertinent to note here that Surcharge is not levied on the Income but is levied on the Income Tax so computed. The manner of computation of Surcharge has been very nicely explained in this article – Surcharge on Income Tax

After the computation of Total Tax Payable computed as per the Income Tax Slabs, the Balance Income Tax payable after the deduction of TDS as shown in Form 16/Form 16A and reflected in Form 26AS shall be payable vide Challan No. 280 in the form of Advance Tax in Installments before the specified Due Dates or else Interest on delay in payment of Income Tax would be liable to be paid.

Income Tax on Domestic Companies is levied @ 30% of Total Income. However, Union Budget 2017 has reduced the Income Tax from 30% to 25% for Domestic Companies with a Turnover of less than Rs. 50 Crores. These reduced income tax rates are applicable from Financial year 2017-18 onwards.

For Domestic Companies with turnover of more than Rs. 50 Crores, Income Tax would continue to be levied at 30%.

Surcharge is also levied in case of Domestic Companies as per the below mentioned schedule. The following schedule is applicable from Financial Year 2017-18 onwards:

Level of Income

Surcharge

Less than Rs. 1 Crore

No Surcharge

More than Rs. 1 Crore but less than Rs. 10 Crore

7%

More than Rs. 10 Crores

12%

C. Education Cess and SHEC

Education Cess @ 2% and Secondary and Higher Education Cess @1% would also be levied on the Total Tax Computed (incl of Surcharge). This Cess is applicable for all categories of taxpayers mentioned above.